It is planned to acquire Vientiane Xinxin, and the layout of digital marketing will be continuously improved. 1) the company intends to acquire Vientiane New Motion, a mobile marketing company, with a transaction consideration of 560 million yuan. It is promised that the net profit of deducting non-parent in 2016, 17 and 18, respectively, will not be less than 4, 000, 200, and 77.74 million yuan, respectively, and the corresponding purchase price will be 7 times that of 14, 11, and 8, respectively. At the same time, it intends to raise 245 million yuan in supporting funds. 2) Vientiane New Motion is a fast-growing mobile marketing company with a self-developed DSP/DMP platform and rich channels / customer resources. 2016H1 has a revenue of 121 million yuan (77% from precision marketing) and a net profit of 16.91 million yuan.
Firm transformation, excellent performance of the target. 1) the company's original main business is LED manufacturing, and in 2015, through "two controls and one reference" (holding Dingsheng Yixuan, hundreds of millions of Wireless, participating in Porto Advertising), the company strongly entered the digital marketing industry. 2) hundreds of millions of Wireless has performed well, promising a net profit of 25 million yuan in 2015. without executive performance awards, the net profit will exceed 42 million yuan and the completion rate will exceed 165%.
The "one horizontal and one vertical" digital marketing strategy is clear. Horizontal layout of the five races: creative planning (Botu advertising) + channel delivery (Shengsheng Yixuan / hundreds of millions of wireless) + data mining (Vientiane New DMP) + programmed purchase (Vientiane New DSP) + media resources; vertically dig vertical subdivision (Dingsheng Yixuan focuses on home decoration industry). The combination of horizontal and vertical can cover the upstream and downstream of the whole industrial chain.
Profit forecast and rating. The annual exam preparation net profit of the company in 2016-17-18 was 2.07 EPS 2.54 / 294 million yuan, including 846 million shares of equity raised, diluted market value of 12.5 billion yuan, fully diluted PE of 0.24 pound 0.30 pound 0.35 yuan, and the corresponding share price PE of each year before that was twice as much as 64-52-45. We believe that the company's "one vertical and one horizontal" digital marketing industry layout strategy is clear, with the gradual improvement of industrial ecology, valuation is expected to be further optimized. Maintain the "overweight" rating.
Risk tips: lower-than-expected acquisitions, macroeconomic decline, industry policy risks.
